Advertising in Virtual Worlds

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by: David Polinchock

UPDATE: The MIT Advertising Lab has an update on brands moving into Second Life at: MIT Advertising Lab: Brands March On Into Second Life.

Lots of interesting coverage in the past few months about companies moving into the virtual worlds to market real world products. Started with the work that Erik Hauser did for Wells Fargo and now more and more companies are getting into the act. The challenge is making sure that you create the right kind of experience for your brand. As we wrote about in Experience Manifesto: RED HERRING | Massive Drives Interactive Ads, simply placing billboards that don't create any real engagement or advancement of the experience will not drive the customer interaction. (Or see Experience Manifesto: Changing Wal-Mart for the problems Wal-Mart is having interacting in the virtual world.)

I'm sure that we're at the very beginning of trend and we'll write more about this in the coming weeks.

Advertisers Can Find Second Life in Metaverses

Mark Kingdon, CEO of Organic, has a great overview piece about virtual marketing at ClickZ that's well worth the read. Just look at the money spent in Second Life. People spent $5.3 million spent buying virtual items. Brnads are just beginning to explore the value of participating in virtual worlds.

According to a recent article, the Second Life audience is mostly comprised of stay-at-home mom's and young professionals, not young teens as you might think.

That explains why there are about $5.3 million in user transactions over the course of a month in Second Life. Players can purchase virtual products such as homes, real estate, clothing, accessories, game services (ie: enhancements to communication system, etc) and pay for them with real dollars via a currency system. Second Life uses "linden dollars," which players buy with real dollars to conduct business with vendors within the game. Once the vendor decides to "cash out," their linden dollars are converted back to U.S. currency (after Linden takes their fee).

But people aren't just buying goods — they're also building viable virtual businesses that provide them with real income. In fact, according to Forbes, there are people making six and seven-figure incomes within the Second Life economy. 

Link: Advertisers Can Find Second Life in Metaverses.

Second Lifers get first look at new hotel chain | CNET

Avatars looking for a stylish place to mingle and get a cocktail will soon be able to check out a trendy new hotel–months before their fleshy counterparts.

Starwood Hotels & Resorts Worldwide, which oversees such well-known hotel brands as Sheraton, St. Regis and Westin, will launch its newest chain, Aloft, in the online society "Second Life" in September.

In the brick-and-mortar realm, the plan is for the first Aloft inn to open sometime in 2008, catering to active, urban 30- to 50-year-olds. But the real-world lodge will be preceded by a 3D cyberversion designed to prompt feedback from virtual guests and help guide the earthbound endeavor.

"We think the SL world is a specific community of early adopters, of tech-savvy people who like to voice their opinions," said Brian McGuinness, vice president of the Aloft Hotels brand.

Aloft will be the first hotel for "Second Life," which has already incorporated businesses from Wells Fargo to Major League Baseball. Marc Schiller, CEO and founder of ElectricArtists 2.0, a marketing services company, approached Starwood two months ago with the idea of a virtual debut for Aloft. Starwood then purchased an island in "Second Life," and construction began on the hotel a month ago. 

Link: Second Lifers get first look at new hotel chain | CNET

Advertising Age – Digital – Virtual Worlds: The Latest Fashion

Before American Apparel launches its first denim line this fall, the offerings are getting a virtual debut and being bought and worn by virtual people. Just as other marketers-from Coca-Cola Co. to Wells Fargo-are creating their own virtual niches, the hip clothing company is letting members of the online game Second Life try the line on for size.

"Since we opened in May, we've sold over 2,000 items to people outfitting their avatars," said Raz Schionning, director of web services for American Apparel, which opened an elaborate retail store last month in Second Life with the help of ad agency Ad Option and web developer Aimee Weber. Virtual shoppers who buy virtual clothes get 15% off the same items in real life. 

Link: Advertising Age – Digital – Virtual Worlds: The Latest Fashion.

Additional links:

Link: Wells Fargo launches game inside 'Second Life' | CNET

Link: Virtual Advertising in a Virtual World.

Link: MIT Advertising Lab: future of advertising and advertising technology: American Apparel Opens Store in Second Life.

Link: Second Life | Community: Events.

Link: Avatar-Based Marketing. (Registration required)

Link: SL Exchange Marketplace Popular Items.

Link: Micro Persuasion: Retailer Opens Outpost in Second Life.

Link: Advertisers Can Find Second Life in Metaverses.

Link: Images: First hotel for 'Second Life' | CNET

Link: You can have a Second Life on the Net.

Link: Making Real Money In Virtual Worlds –




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